A One Dollar Decrease in a Call Option's Exercise Price

question 10

Multiple Choice

A one dollar decrease in a call option's exercise price would result in a(n) __________ in the call option's value of __________ one dollar.

• A)increase, more than
• B)decrease, more than
• C)decrease, less than
• D)increase, less than
• E)increase,exactly

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Definitions:

Returns to Scale

The speed at which production levels rise due to a corresponding rise in all contributing factors.

Labor Hours

The total hours of work put in by workers or employees during a specified period.

Market Costs

Expenses incurred by companies during the production and distribution of goods or services in the marketplace.

Hydraulic Lifts

Mechanical devices that use fluid pressure to raise or lower objects, often used in automotive repairs and construction.